Tesla Motors Inc (TSLA) will open a production factory in Europe when annual sales hit 160,000 there

Tesla Motors Inc (NASDAQ:TSLA) CEO Elon Musk said that the company will open a factory in Europe once annual sales cross 160,000 units.

“My aspirations for Europe are that we sell a comparable number of cars in Europe as the U.S,” said Musk.

Tesla will have factories in the U.S., Europe, and China when annual worldwide sales exceed 500,000. The 160,000 mark in Europe and 500,000 mark globally is likely 5 years away.

Setting up factories in Europe and China would be beneficial for logistics reasons. Having vehicles built there could reduce costs and delivery times, which leads to an increase in profits. Price reductions for consumers could be around 25% through localized production.

Tesla already has a final assembly location in the Netherlands, but production does not take place there.